House Asks Senate to Exclude Auto Dealers from Oversight
WASHINGTON - House negotiators have proposed that the Senate agree to drop auto dealers from oversight of a proposed consumer watchdog agency, reported The Detroit News.
House and Senate negotiators have spent the last week working to craft a compromise overhaul of the nation's financial system.
One big issue of contention is whether the nation's 17,000 new car dealers should be subjected to oversight under a new Consumer Financial Protection Agency.
In a two-page proposal circulated by Rep. Barney Frank, D-Mass, chairman of the House Financial Services Committee, negotiators have asked the Senate to agree to exempt auto dealers from oversight -- bucking the White House.
Earlier this month, the Senate approved a non-binding resolution calling on its leaders to agree to the House language on auto dealers.
But the House in December voted to exempt dealers, and last week a group of 62 House Democrats urged party leaders to insist that auto dealers be exempted.
The House offer would exclude auto dealers -- asking the Senate to adopt their provision, which included dealers in their version.
"Main Street auto dealers commend Chairman Frank and House conferees for including language which preserves auto financing as an affordable option for car buyers in the House's offer to the Wall Street reform bill conference committee," said Bailey Wood, a spokesman for the National Automobile Dealers Association. "NADA strongly urges all conferees to accept the House's language regarding dealer-assisted financing."
The White House and the Pentagon strongly back regulating auto lending, saying it's necessary -- especially to protect young service members from exploitation from unscrupulous auto dealers. Auto dealers say lending is already heavily regulated.
Exempting auto dealers, President Barack Obama argued last month, "would allow them to inflate rates, insert hidden fees into the fine print of paperwork, and include expensive add-ons that catch purchasers by surprise."
An exemption, the president said, "guts provisions that empower consumers with clear information that allows them to make the financial decisions that work best for them."
The conference committee could see another attempt this week by Rep. Darrell Issa, R-Calif., who wants to bar companies that are owned or partially owned by the government from hiring outside lobbyists.
Issa's proposal to bar General Motors Co., Chrysler Group LLC and Ally Financial Inc. failed last week.
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